White House Spokesman’s Advice: Don’t Invest in Russian Stocks

White House Press Secretary Jay Carney at the White House in the file photo from last week.

Agence France-Presse/Getty Images

WASHINGTON—The White House on Tuesday defended U.S. sanctions against Russia amid criticism that they weren’t effective, and made a rare foray into personal investment decisions.

“I wouldn’t, if I were you, invest in Russian equities right now—unless you’re going short,” President Barack Obama’s chief spokesman, Jay Carney, said Tuesday when pressed whether Russia was shrugging off U.S. sanctions.

The U.S. sanctions, enacted Monday, froze the assets of seven Russians and four Ukrainians and prohibits Americans from doing business with any of those named. The Russian ruble and stock markets in Russia and Europe, which had been weighed down by the Ukrainian crisis, rallied over the past several days as investors determined the U.S. and European Union sanctions against Russia were more mild than expected and as Russian President Vladimir Putin said he didn’t want further confrontation with Ukraine.

The White House usually declines to comment about swings in the financial markets, and tries to avoid saying anything to spook investors. But Mr. Carney said he thinks the U.S. and European Sanctions, combined with Russia’s own actions in Ukraine, will harm Russia’s economy.

“I think the ruble has lost value. And I think that the long-term effect of actions taken by the Russian government, in clear violation of the United Nations charter, in clear violation of its treaty commitments, that are destabilizing and illegal, will have an impact on their economy all by themselves,” Mr. Carney said.

He also said the U.S. is preparing more penalties against Russia.

Mr. Obama also rarely comments on financial markets, though in broad terms he does refer to it when discussing the economy. For instance, in Connecticut earlier this month he mentioned the stock market while urging Congress to raise the minimum wage.

He said raising the minimum wage is “a smart way to boost productivity” and said companies that pay the minimum wage, do well. “Their stocks do great. They are highly profitable. It’s not bad business to do right by your workers, it’s good business,” he said.

And last year, when Mr. Obama and Republicans were at loggerheads over how to fund the government, Mr. Obama said Wall Street should be worried. “This time is different. I think they should be concerned,” he said.

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